The Japanese owner of a container ship that has been blocking the Suez canal for more than three days says it aims to free the vessel by “tomorrow night Japan time” but cannot guarantee the effort will be complete by then.
Global shipping companies are starting to re-route cargo away from a jam of vessels on both sides of the stricken container ship Ever Given, which is blocking one of the world’s key trade arteries.
The Japanese firm Shoei Kisen said the refloating work was ongoing but no firm end point was yet in sight. “We don’t have an estimate for when the work will succeed,” a spokesperson told local media.
With the stuck ship holding up an estimated £6.9bn ($9.5bn) worth of goods in huge traffic jams at either end of the canal, seven tankers carrying liquefied natural gas (LNG) were diverted on Friday after the blockage caused traffic to be suspended.
Three of the tankers were being diverted towards the longer route around Africa, via the Cape of Good Hope, the data intelligence firm Kpler said, adding that most of the diverted tankers originally destined for Suez canal were now headed elsewhere.
“A total of 16 LNG vessels’ planned transit via the Suez canal will be affected if the congestion persists until the end of this week,” said Rebecca Chia, a Kpler anlayst based in Singapore.
As of Friday morning, the Panama-registered vessel, operated by Evergreen Marine of Taiwan, remained grounded in the same position, with tugboats and dredgers still working to free it, according to the canal service provider Leth Agencies.
An Egyptian canal authority official told Associated Press the refloating operation was a “very sensitive and complicated” operation. They wanted to avoid “any complications” that could extend the canal closure.
The canal authority said late on Thursday it would need to remove up to 706,000 cubic feet (20,000 cubic metres) of sand to reach a depth of 39 to 52 feet (12 to 16 metres). That depth is likely to allow the ship to float freely again, it said.
At least four Long-Range 2 tankers that might have been headed towards Suez from the Atlantic basin were now likely to be evaluating a passage around the Cape of Good Hope, the London-based shipbroker Braemar ACM said on Friday. Each LR-2 tanker can carry 75,000 tonnes of oil.
The international shipping company Maersk said on Friday it was “looking at all alternatives” for its nine container ships stuck in the queues.
“Everyone is making contingency plans as we speak,” said Peter Sand, chief shipping analyst at BIMCO, according to CNN.
Authorities in Egypt will continue to work with salvage teams from across the world to free the Ever Given, which became lodged across the southern section of the canal on Tuesday when it lost control during a storm. Tugs have been unable to pull it free and efforts to dig out the bow with excavators have come to nothing.
Experts fear that the massive ship, which is 400-metres long and has a gross tonnage of almost 220,000, has wedged so far into the sand on either bank of the canal that it might not be possible to dislodge it without removing some of its cargo. Such a process could take weeks, according to Peter Berdowski, chief executive of Boskalis, a specialist dredging company that has sent a crew to the scene.
Maersk said in a statement on Friday: “We closely follow the refloating operations and are currently looking at all alternatives possible.”
Maersk’s main international rival, Hapag-Lloyd, was also reported by Agence-France Presse to be considering sending shipping round the Cape of Good Hope, on the southern tip of Africa, in order to ensure goods could reach Europe without even greater delays.
On Friday, more than 200 ships were stuck at the north and south ends of the canal. Originally built in the 1860s, the northern section was expanded into two lanes in 2015 but the southern section where the Ever Given is stuck is only one lane.
About 12% of all global trade flows through the 120-mile (193km) canal.
Lloyd’s List, the shipping data and news company, estimated on Friday that goods worth $9.6bn pass through the canal every day. About one quarter of that traffic is on container ships – like the one now burrowed into one side wall of the canal. Lloyd’s said more than 50 ships traverse the canal on an average day.
Flavio Macau, a senior lecturer in supply chain management at Edith Cowan University in Western Australia, said it made sense for Maersk and Hapag-Lloyd to think about re-routing their shipping because longer delays at Suez could be costly.
“If you go to Suez you might expect to be 20th or 30th in line perhaps because there are about 50 ships in each direction every day,” he said. “But now you could be number 250 so that means you will be waiting three to four days to get through even when it reopens.”
There were also concerns that the Suez situation could compound issues for an international supply chain already under pressure from the pandemic and a surge in buying.
Virus-related restrictions have trapped crews on merchant ships. Congested ports have led to container ships anchoring off the California coast, unable to dock and unload their goods. Shortages of semiconductors and rare-earth elements have plagued manufacturers of cars and other consumer products.
The reaction of financial markets to the prospect of goods being delayed for weeks has been muted, although the price of oil did bump up when Friday’s trading day began in Asia. Brent crude was higher by 43c, or 0.7%, at $62.38 a barrel by 0028 GMT, after dropping 3.8% on Thursday.
Macau said that although the delays would hurt those directly involved such as the Egyptian government, the owners and insurers, the overall damage was not critical.
“We are seeing a loss of efficiency. But we are not losing all the ships, all the cargo or all the routes for shipping. We can redirect the flow but it’s important to remember that there is no stop in manufacturing or demand. It’s not the zombie apocalypse as some people have said.”